Snyder's-Lance Earnings Preview

Snyder's-Lance (NAS: LNCE) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Friday. Lance manufactures, markets, and distributes a variety of snack food products.

What analysts say:

Buy, sell, or hold?: Analysts think investors should stand pat on Snyder's-Lance with eight of 12 analysts rating it hold. Analysts don't like Snyder's-Lance as much as competitor Hain Celestial Group overall. Seven out of 10 analysts rate Hain Celestial Group a buy compared to four of 12 for Snyder's-Lance. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.

Revenue forecasts: On average, analysts predict $402.6 million in revenue this quarter. That would represent a rise of 41.2% from the year-ago quarter.

Wall Street earnings expectations: The average analyst estimate is earnings of $0.25 per share. Estimates range from $0.23 to $0.28.

What our community says:CAPS All-Stars are solidly behind the stock, with 89.3% awarding it an "outperform" rating. The greater community backs the All Stars, as 85% give it a rating of "outperform." Fools are keen on Snyder's-Lance, though the message boards have been quiet lately with only 43 posts in the past 30 days. Snyder's-Lance has a CAPS rating of five out of five stars.

Management:The company's gross margin shrank by 6.5 percentage points in the last quarter. Revenue rose 77.5% while cost of sales rose 96.8% to $280.9 million from a year earlier.

Now let's get some insight into how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. Snyder's-Lance has seen slipping gross margins year-over-year for the last four quarters. Gross margins reflect the total sales revenue retained after costs. Here are Snyder's-Lance's reported margins for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

33.4%

34.8%

36.3%

36.1%

Operating Margin

3.4%

(0.9%)

5.2%

(5.7%)

Net Margin

2.1%

(0.9%)

2.8%

(6.8%)

One final thing: If you want to keep tabs on Snyder's-Lance movements, and for more analysis on the company, make sure you add it to your watchlist.